Digital currency bitcoin has emerged as a rival to gold (bitcoin price) and could trade as high as $146,000 if it becomes established as a safe-haven asset, investment bank JPMorgan (JPM) said on Tuesday.

Interest in the world's biggest cryptocurrency has soared this year, with investors viewing  (bitcoin price) bitcoin as a hedge against inflation and an alternative to the depreciating dollar. The rush led to bitcoin prices more than tripling in the past six months to a record peak of $34,800 on Jan. 2.

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"Bitcoin's competition with gold has already started in our mind," the Wall Street bank's strategists said in a note, citing recent $7 billion outflows (bitcoin price) from gold and more than $3 billion of inflows into the Grayscale Bitcoin Trust.

That could mark a new dawn for the volatile digital currency after years as a play for  (bitcoin price) speculators and retail punters.

"Considering how big the financial investment into gold is, a crowding out of (bitcoin price)  gold as an 'alternative' currency implies big upside for bitcoin over the long term," JPM said.

Bitcoin is likely to outshine gold as millennials become a more important component of the  (bitcoin price) investment market over time and given their preference for "digital gold" over traditional bullion, JPM added.

With a market capitalization of $575 billion, the bitcoin price would need a nearly fivefold jump to $146,000 to match the value of private gold wealth held in gold bars, coins or exchange-traded funds, the bank's note added.

JPM strategists said the upside is conditional on the volatility of bitcoin converging with that of gold in the longer term.